Weekly jobless claims rise 12,000 to 465,000

Continuing claims drop 48,000 to 4.49 million

WASHINGTON (MarketWatch) — The number of people who filed new claims for unemployment benefits jumped 12,000 to 465,000 in the latest week, underscoring the lack of hiring in a weak U.S. labor market.

New claims for jobless benefits had dropped two straight weeks, but part of the decline stemmed from a disruption in the government’s data collection caused by the Labor Day holiday in early September. Claims often rise briefly after the holiday.

Economists polled by MarketWatch had expected initial claims to rise to a seasonally adjusted 455,000 in the week ended Sept. 18. Claims for last week were revised up by 3,000 to 453,000.

Although new applications for unemployment compensation have tumbled 8% since spiking in July, claims are still at historically elevated levels at this stage of an economic recovery. Weak growth and slack demand for their products and services has deterred most companies from adding to their workforce, keeping the U.S. unemployment rate of 9.6% near a 27-year high.

“The labor market remains weak and while any number of people continues to suggest ... that robust hiring is just around the corner, such job growth simply isn’t materializing,” economic strategist Dan Greenhaus of Miller Tabak & Co. wrote in an email. “We remain of the belief that it will not for several more quarters.”

A more accurate gauge of employment trends is the four-week average of initial claims, which is less volatile than the weekly number. The four-week average dipped 3,250 to 463,250.

“Aside from some elevated readings in August, the four-week average has held between 450,000 and 465,000 since the end of March, underscoring the painfully slow pace of progress in the labor market,” RBS Economic Research said in a report.

The latest claims report relies on one estimate — for the state of Nebraska. The Labor Department had to make estimates for two states last week and nine during the holiday week.

In the week ended Sept. 11, about 4.49 million workers continued to receive benefits under regular state unemployment programs. That was down 48,000 on a seasonally adjusted basis. The four-week average of continuing claims rose by 2,500 to 4.52 million.

About 5.17 million people received extended benefits in the week ended Sept. 4, up almost 208,000 from 4.96 million the prior week. Extended federal benefits of up to 99 weeks are offered to millions of workers after they use up eligibility for state unemployment compensation.

Regular benefits last six months in most states.

About 9.18 million people were getting some kind of unemployment benefit in the week ended Sept. 4, little changed from the prior week. More than 8 million Americans lost their jobs during the worst of the recession in 2008 and 2009.

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